May
26

Bad Samaritans

Ha-Joon Chang has written many excellent books, on this blog I have covered Kicking Away the Ladder and 23 Things They Don't Tell You About Capitalism. With the encouragement of Oxfam's Duncan Green, in 2007 Chang published "Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism". The book aims for a general audience, and in many ways puts the arguments in the above two books in a more accessible way, often conveyed via story. For the details, see his other books. Many of the examples are getting dated, but still a useful read. Some notes:

"This neo-liberal establishment would have us believe that, during its miracle years between the 1960s and the 1980s, Korea pursued a neo-liberal economic development strategy. The reality, however, was very different indeed. What Korea actually did during these decades was to nurture certain new industries, selected by the government in consultation with the private sector, through tariff protection, subsidies and other forms of government support (e.g., overseas marketing information services provided by the state export agency) until they 'grew up' enough to withstand international competition. The government owned all the banks, so it could direct the life blood of business—credit. Some big projects were undertaken directly by state-owned enterprises—the steel maker, POS CO, being the best example—although the country had a pragmatic, rather than ideological, attitude to the issue of state ownership. If private enterprises worked well, that was fine; if they did not invest in important areas, the government had no qualms about setting up state-owned enterprises (SOEs); and if some private enterprises were mismanaged, the government often took them over, restructured them, and usually (but not always) sold them off again." (p. 14)

"Unfortunately, another lesson of history is that rich countries have 'kicked away the ladder' by forcing free-market, free-trade policies on poor countries. Already established countries do not want more competitors emerging through the nationalistic policies they themselves successfully used in the past. Even the newest member of the club of rich countries, my native Korea, has not been an exception to this pattern. Despite once having been one of the most protectionist countries in the world, it now advocates steep cuts in industrial tariffs, if not total free trade, in the WTO." (p. 61)

"Markets have a strong tendency to reinforce the status quo. The free market dictates that countries stick to what they are already good at. Stated bluntly, this means that poor countries are supposed to continue with their current engagement in low-productivity activities. But their engagement in those activities is exactly what makes them poor. If they want to leave poverty behind, they have to defy the market and do the more difficult things that bring them higher incomes—there are no two ways about it." (p. 210)

"Knowing what policies are right for your particular circumstances is not enough. A country must be able to implement them. Over the past quarter of a century, the Bad Samaritans have made it increasingly difficult for developing countries to pursue the 'right' policies for their development. They have used the Unholy Trinity of the IMF, the World Bank and the WTO, the regional multilateral financial institutions, their aid budgets and bilateral and regional free-trade or investment agreements in order to block them from doing so. They argue that nationalist policies (like trade protection and discrimination against foreign investors) should be banned, or severely curtailed, not only because they are supposed to be bad for the practising countries themselves but also because they lead to 'unfair' competition. In arguing this, the Bad Samaritans constantly invoke the notion of the 'level playing field.' The Bad Samaritans demand that developing countries should not be allowed to use extra policy tools for protection, subsidies and regulations, as these constitute unfair competition." (p. 217-218). 

  536 Hits
Aug
22

The End of Empire and the Birth of Neoliberalism

"Globalists: The End of Empire and the Birth of Neoliberalism" (2018) by Slobodian (Harvard Press) is a detailed history of the people and ideas neoliberalism, and the institutions they created. The book is historical and delved into the deep end. One reflection, which is somewhat counter intuitive, is that neoliberals are not opposed to government or regulation, just certain types. In fact, they are very pro certain types of governance / law / regulation, such as protecting private capital internationally (which requires clear and strong international law). A few quotes:

"If we place too much emphasis on the category of market fundamentalism, we will fail to notice that the real focus of neoliberal proposals is not on the market per se but on redesigning states, laws, and other institutions to protect the market." (p. 6)

"Hayek himself was explicit that the international power needed "an authority capable of enforcing [the] rules." Although after the war Hayek swerved away from engagement with international order, other neoliberals did not. As we will see, neoliberals argued against adding social and economic rights to the basic list of negative rights, even as they made the case for economic rights of their own - above all, the right to keep foreign investment safe and to move capital freely over borders. Like Hayek, they focused on the expropriation of foreign-owned property and controls on capital movements as being the central violations of rights. They would help design institutions that would safeguard the "negative rights" of freedom from expropriation and capital control." (p. 123)

"Other neoliberal thinkers downplayed the centrality of culture and race after 1945, but Ropke insisted on its importance. "Racial fanaticism," he wrote in 1965, "does not justify denying that there is something called ethnos, race, and it is elementary importance." The literature he footnoted was stark in its hierarchical biological essentialism. Among his recommendations for the field of "ethnopsychology" was a study that concluded that "mental capacity tends to be adequate among peoples and races adjusted to cold and temperate climates but inadequate among those adjusted to hot climates" and warned of "lethal power in the hands of nation-states dominated by populations incapable of rational thought." At a time when biological race was being either marginalized or recorded for many of the social sciences, Ropke brought it to the center of his analysis." (p. 157)

"Scholars often use overly broad characterizations of Global South countries as adherents to the ideology of dependency theory, which supposedly privileged the protection of infant industry above all else to diversify the economy. In that narration, the exceptions are those countries with especially close ties to the United States - Japan, Taiwan, and South Korea - whose export-oriented industrialization models are usually seen as prefiguring the direction in which development would go once the third world snapped out of its dependency-theory-driven delusions. Looking at the response to the Haberler Report, one sees that the truth is less black-and-white. In fact, developing countries were advocates of both protection and liberalization at the same time. They followed a policy of "both-and" rather than "either-or"." (p. 202) 

  714 Hits
Apr
08

Silences in NGO Discourses

Issa G. Shivji is one of East Africa's well-known critical scholars, researchers and professors. Much of his work has appeared in shorter essay form, as opposed to academic articles or books (although he has published several books as well). "Silences in NGO Discourses: The Role and Future of NGOs in Africa" (2007) is one of those books, although it is a compilation of two essays. This book might not be readily available at your local bookshop, but fortunately is can be found online. The first essay (Silences in NGO Discourses) is available here. The second essay (Reflections on NGOs in Tanzania) is available here.

Opening quote: "…the transformation from a colonial subject society to a bourgeois society in Africa is incomplete, stunted and distorted. We have the continued domination of imperialism – reproduction of the colonial mode – in a different form, currently labelled globalisation or neoliberalism. Within this context, NGOs are neither a third sector, nor independent of the state. Rather, they are inextricably imbricated in the neoliberal offensive, which follows on the heels of the crisis of the national project. Unless there is awareness on the part of the NGOs of this fundamental moment in the struggle between imperialism and nationalism, they end up playing the role of ideological and organisational foot soldiers of imperialism…"

Assumptions: "I believe I have shown sufficiently that the 'common sense' theoretical assumption of the current period underpinning NGO roles and actions is neoliberalism in the interest of global imperialism. It is fundamentally contrary to the interests of the large majority of the people. Taking for granted the fundamentals of neoliberalism and financial capitalism, or challenging them only piecemeal on specific issues, for example debt, environment or gender discrimination, actually draws the NGOs as protagonists into the imperial project. Brian Murphy argues that many mainstream NGO leaders have internalised assumptions and ways of neo-conservatism, and are convinced that globalisation akin to neoliberalism are inevitable and irreversible." (p. 36-37)

Contextualization: "how can you make poverty history without understanding the history of poverty? We need to know how the poverty of the five billion of this world came about. Even more acutely, we need to know how the filthy wealth of the 500 multinationals or the 225 richest people was created (Peacock 2002). We need to know precisely how this great divide, this unbridgeable chasm, is maintained; how it reproduced itself, and how it is increasingly deepened and widened. We need to ask ourselves: What are the political, social, moral, ideological, economic and cultural mechanisms which produce, reinforce and make such a world not only possible, but seemingly acceptable?" (p. 37-38)

The non-political: "The political sphere is built on the sphere of production, and there is a close relationship between those who command production and those who wield power. Yet the NGO sector, which according to its own proclamations stands for change, accepts the ideological myth that it is the third sector: non-political, not-for-profit, having nothing to do with power or production. This bourgeois mythology mystifies the reality of capitalist production and power, thus contributing to its legitimisation. NGOs by accepting the myth of being non-political contribute to the process of mystification, and therefore objectively side with the status quo, contrary to their expressed stand for change." (p. 41-42)

New directions? "Just as the African people have struggled and opposed structural adjustment in the streets, African intellectuals have critically scrutinised its neoliberal underpinnings and exposed globalisation as a new form of imperialism. African NGOs must creatively appropriate these intellectual insights. They must learn from the actually existing struggles of the people before evangelising on donor-fads of the day: gender, human rights, female genital mutilation, good governance, etc. The educators must first be educated." (p. 45)

NGO business: "We activists are not in the business of brokering power where expediency and compromise rule. Our business is to resist and expose the ugly face of power. We are guided and our work is informed by deeply held human values and causes. It seems to me that consistency of principles and commitment to humanity should inform all our work, thought, activism and advocacy." (p. 59)

Self-reflection: "In 2003 the whole world was shaken to the core and basic human values were cynically challenged when the United States invaded and occupied Iraq. Millions of people all over the world demonstrated and protested in great defiance of this monstrosity – as individuals, as NGO activists, as simple decent human beings. Here in Dar es Salaam, our NGO world was shamefully silent. A small demonstration organised by the university student union attracted a few NGOs and activists. But well-known human rights NGOs and advocates were conspicuous in their absence. The umbrella NGO organisations did not so much as issue a simple statement, either on their own or in solidarity with others. How can we who espouse democratic values of freedom and self-determination explain such silence?" (p. 60)

  1410 Hits
Subscribe to receive new blog posts via email